Opinion
No. 771 C.D. 2011
03-29-2012
Joseph Buckley, Petitioner v. Workers' Compensation Appeal Board (City of Pittsburgh), Respondent
BEFORE: HONORABLE BERNARD L. McGINLEY, Judge HONORABLE RENÉE COHN JUBELIRER, Judge HONORABLE ROCHELLE S. FRIEDMAN, Senior Judge
The opinion in this matter was reassigned to the authoring judge on December 13, 2011.
OPINION NOT REPORTED
MEMORANDUM OPINION BY JUDGE COHN JUBELIRER
Joseph Buckley (Claimant) petitions for review of the Order of the Workers' Compensation Appeal Board (Board) that reversed the decision of a Workers' Compensation Judge (WCJ) to award unreasonable contest attorneys' fees to Claimant pursuant to Section 440 of the Workers' Compensation Act (Act), 77 P.S. § 996. On appeal, Claimant argues that the Board erred in holding that the City of Pittsburgh (Employer) had a reasonable basis for filing its Petition to Suspend Benefits (Suspension Petition) or, alternatively, if Employer had a reasonable basis when it filed the Suspension Petition, its contest became unreasonable when it became clear from the evidence offered that Claimant was actively seeking employment and, therefore, had not voluntarily withdrawn from the workforce. For the following reasons, we affirm.
Act of June 2, 1915, P.L. 736, added by Section 3 of the Act of February 8, 1972, P.L. 25, as amended.
On March 13, 2004, Claimant, a fire captain for Employer, was struck by a fifty-foot truss, resulting in a traumatic brain injury, shortened biceps, a ruined ulnar nerve, a broken back, a punctured lung, a lacerated kidney, a broken wrist, and a broken jaw. Claimant received benefits pursuant to the act commonly known as the Heart and Lung Act, which ultimately were converted into workers' compensation benefits by stipulation dated October 1, 2005. Thereafter, Claimant applied for and received a disability pension from Employer. On August 27, 2008, Employer issued a Notice of Ability to Return to Work (Notice) based on Claimant's treating physician's opinion that Claimant could return to light-duty work. On September 5, 2008, Employer filed the Suspension Petition on the grounds that Claimant was physically capable of working, but had voluntarily removed himself from the workforce. Claimant filed an answer, denying the allegations and requesting unreasonable contest attorneys' fees. The matter was then assigned to the WCJ. (WCJ's Findings of Fact (FOF) ¶ 1; WCJ Hr'g Tr. February 19, 2009, at 4-5, R.R. at 11a-12a; Notice, R.R. at 44a.)
Act of June 28, 1935, P.L. 477, as amended, 53 P.S. §§ 637-38.
The WCJ held a hearing on the Suspension Petition on February 3, 2009, at which Employer submitted, inter alia, the Notice. It appears from the record that there was no dispute that Claimant accepted a disability pension from Employer after having his Heart and Lung benefits terminated or that Claimant was not presently employed. Claimant did not appear, but Claimant's counsel submitted an affidavit in which Claimant stated that he had not removed himself from the workforce and was actively seeking employment. Claimant's counsel also submitted various exhibits, including Claimant's resume and a list of positions Claimant had applied to since September 2008. Employer objected to the affidavit and exhibits on hearsay grounds as to the case-in-chief, but did not object to their admission for supersedeas purposes. At the conclusion of the hearing, the WCJ indicated that she would schedule another hearing so that Claimant could testify in person. (WCJ Hr'g Tr., February 3, 2009, at 7-8.)
The second hearing was held on February 19, 2009. Claimant appeared at the hearing and testified, inter alia, that he did not consider himself retired. Claimant stated that he had earned a bachelor's degree, obtained a teacher's license, and planned to become a physical education teacher after retiring from Employer at age fifty. According to Claimant, however, his ongoing cognitive impairment and arm injury prevented him from becoming a physical education teacher. Claimant explained that, both before and after Employer filed the Suspension Petition, he continued to seek employment despite his injury-related limitations. At the conclusion of the hearing, Claimant renewed his request for unreasonable contest attorneys' fees. (FOF ¶ 2; WCJ Hr'g Tr., February 19, 2009, at 4-12, 19, R.R. at 11a-19a, 26a.)
The WCJ held a third hearing on June 16, 2009, after the parties attended, unsuccessfully, mandatory mediation. Employer's counsel requested another mediation session, but Claimant's counsel advised the WCJ that Claimant was no longer interested in pursuing mediation. Employer's counsel then requested to withdraw the Suspension Petition. Employer reiterated its withdrawal request, as well as its opposition to the request for attorneys' fees by letter dated July 21, 2009. (WJC Hr'g Tr., June 16, 2009, at 3-5; Letter from Employer to WCJ and Claimant (July 21, 2009), R.R. at 47a-49a.)
Following the withdrawal of the Suspension Petition, the only item before the WCJ was Claimant's request for unreasonable contest fees. The WCJ issued a decision on October 1, 2009, in which she memorialized the withdrawal of the Suspension Petition and made findings of fact and conclusions of law with respect to Claimant's request for attorneys' fees. In that opinion, the WCJ credited Claimant's testimony and found that Claimant was actively seeking employment. The WCJ further found that Employer presented no evidence that it had consulted with an expert regarding whether Claimant's cognitive impairment prevented him from working. Thus, the WCJ found Employer's contest via the Suspension Petition to be unreasonable and ordered Employer to pay Claimant's attorneys' fees pursuant to Section 440 of the Act. (FOF ¶¶ 2-3; WCJ's Conclusions of Law ¶ 1.)
Employer appealed to the Board, arguing that the award of attorneys' fees was unwarranted because its contest was reasonable at all times, and the Board agreed. The Board held that, at the time Employer filed its Suspension Petition, Employer neither knew nor should have known that Claimant was actively seeking employment. Moreover, the Board noted that Employer had withdrawn its Suspension Petition upon learning that Claimant was actively seeking employment and, therefore, had not removed himself from the workforce. Accordingly, the Board held that "an award of attorneys' fees [was] not appropriate and should not act as a sanction in addition to [E]mployer's other obligations. Arbogast[ & Bastian v. Workmen's Compensation Appeal Board (Moyer), 599 A.2d 275 (Pa. Cmwlth. 1991).]" (Board's Op. at 6-7.) Claimant now petitions this Court for review.
"Our review is limited to determining whether an error of law was committed, whether necessary findings of fact are supported by substantial evidence and whether constitutional rights were violated." Sysco Food Services of Philadelphia v. Workers' Compensation Appeal Board (Sebastiano), 940 A.2d 1270, 1273 n.1 (Pa. Cmwlth. 2008).
Claimant argues that the Board erred in reversing the award of unreasonable contest attorneys' fees because Employer had no reasonable basis for contesting its liability through the filing of the Suspension Petition. Additionally, Claimant contends that, even if Employer's contest was reasonable at the time it filed the Suspension Petition, it became unreasonable when it became apparent at the first hearing that Claimant was actively seeking employment and had not voluntarily retired from the workforce.
Section 440(a) of the Act provides that a successful claimant shall be awarded attorneys' fees unless the employer proves that it had a reasonable basis for the contest. 77 P.S. § 996(a). "Whether an [e]mployer's contest of liability is reasonable is a question of law reviewable by this Court." Capper v. Workers' Compensation Appeal Board (ABF Freight Systems, Inc.), 826 A.2d 46, 50-51 (Pa. Cmwlth. 2003). "[T]he reasonableness of an employer's contest depends upon whether the contest was prompted to resolve a genuinely disputed issue or merely to harass the claimant." Id. at 51. The employer bears the burden of proving the reasonableness of its contest but, in doing so, need not prove that its evidence is legally sufficient in order to establish reasonableness. Id. Instead, "[a] reasonable contest is established where the evidence is conflicting or subject to contrary inferences." Lemansky v. Workers' Compensation Appeal Board (Hagan Ice Cream Company), 738 A.2d 498, 501 (Pa. Cmwlth. 1999). In determining the reasonableness of a contest, the appellate court must look to the totality of the circumstances surrounding the contest. Eidell v. Workmen's Compensation Appeal Board (Dana Corporation), 624 A.2d 824, 826 (Pa. Cmwlth. 1993).
Claimant first contends that the Board erred because Employer did not have a factual basis for filing the Suspension Petition. We disagree. Employer filed the Suspension Petition based on Claimant's receipt of a disability pension, the opinion of its treating physician that Claimant was capable of performing light-duty work, and the issuance of the Notice to Claimant so indicating. At the time Employer filed the Suspension Petition, this Court and our Supreme Court had been interpreting the Act's suspension provisions as permitting an employer to establish its entitlement to a suspension of benefits based on the claimant's voluntary removal from the workforce by presenting evidence that the claimant had accepted a pension from the employer. Pennsylvania State University v. Workers' Compensation Appeal Board (Hensal), 948 A.2d 907, 910 (Pa. Cmwlth. 2008) (en banc) (citing Southeastern Pennsylvania Transportation Authority v. Workmen's Compensation Appeal Board (Henderson), 543 Pa. 74, 669 A.2d 911 (1995)). Once the employer presented evidence of the acceptance of the pension, the claimant had to show that the claimant was either "seeking employment or . . . the work-related injury forced him to retire." Id.
We note, as Employer does in its brief, that the law in this area has subsequently changed pursuant to City of Pittsburgh v. Workers' Compensation Appeal Board (Robinson), 4 A.3d 1130 (Pa. Cmwlth. 2010) (en banc), appeal granted, ___ Pa. ___, 17 A.3d 917 (2011). In Robinson, this Court noted that "[i]n determining whether acceptance of a pension should create a presumption that a claimant has terminated her career, it is important to look at the facts involved and the type of pension." Id. at 1137. Thus, pursuant to Robinson, in order to prove that a claimant has retired for purposes of Henderson and that the employer is entitled to the suspension of benefits, "an employer must show, by the totality of the circumstances, that the claimant has chosen not to return to the work[ force." Id. at 1138. Robinson was filed, however, after both Employer's Suspension Petition and the WCJ's decision in this matter. Therefore, the standard set forth in Hensal applied to the present matter. --------
Here, the Board determined, and we agree, there is no evidence in the record that showed Employer, at the time it filed the Suspension Petition, knew or should have known that Claimant was actively seeking employment. Indeed, Claimant's answer to the Suspension Petition did not indicate that Claimant was actively searching for work, only that "[i]t is denied that the employer is entitled to modification of the claimant's benefits from total to partial based upon an IRE." (Answer to Suspension Petition at 1, R.R. at 6a.) Although Claimant contends that there were many ways that Employer could have discovered Claimant's efforts in seeking employment, Employer's knowledge at the time it filed the Suspension Petition was that Claimant had accepted a disability pension from Employer, Claimant's physician released him to light-duty work, and Claimant had not yet responded with why his return to work was not possible. Although such evidence may not be legally sufficient to establish Employer's entitlement to a suspension, particularly under the holding of our recent decision in City of Pittsburgh v. Workers' Compensation Appeal Board (Robinson), 4 A.3d 1130 (Pa. Cmwlth. 2010) (en banc), appeal granted, ___ Pa. ___, 17 A.3d 917 (2011), we conclude that such evidence establishes a reasonable basis upon which Employer could contest liability under Hensal. Capper, 826 A.2d at 51 (stating that an employer's evidence need not be legally sufficient in order to establish a reasonable contest). Accordingly, we conclude that Employer's contest was reasonable at the time it filed the Suspension Petition.
Claimant next argues that, if Employer had a reasonable basis upon which to contest liability when it filed the Suspension Petition, that contest became unreasonable after the February 3, 2009, hearing at which Claimant's counsel submitted Claimant's affidavit to show that Claimant had not removed himself from the workforce and was actively seeking employment. Claimant asserts that the Board erred in concluding that Employer "promptly withdrew its Suspension Petition as soon as it became aware that Claimant was actively seeking employment and had not removed himself from the workforce." (Board Op. at 6.) Accordingly, Claimant maintains that Employer's contest became unreasonable following the February 3, 2009, hearing and should be liable for paying his attorneys' fees following that hearing.
As noted above, under the prevailing law at the time Employer filed its Suspension Petition, once Employer demonstrated that Claimant had taken a pension it had met its burden under Henderson. Hensal, 948 A.2d at 910. Thus, the burden had shifted to Claimant to demonstrate that he was actively seeking employment or that his work injury had caused him to retire completely. Id. Although Claimant presented the affidavit at the February 3, 2009, hearing indicating that he was looking for work, that affidavit was subject to a hearsay challenge and was admitted only for supersedeas purposes. (WCJ Hr'g Tr., February 3, 2009, at 7-8.) Consequently, the affidavit was not yet evidence of the fact that Claimant was actively seeking employment. Moreover, although Claimant's testimony from the February 19, 2009, hearing that he was seeking work would satisfy his burden of proof, that testimony remained subject to the WCJ's credibility determination and, if found not credible, Claimant would have been unable to satisfy his burden and Employer would have prevailed. For these reasons, we conclude that it was not unreasonable of Employer to seek mediation to determine whether a settlement was possible before withdrawing the Suspension Petition and that Employer's contest was not rendered unreasonable by its decision not to withdraw the Suspension Petition until after mediation proved to be unsuccessful.
Accordingly, we affirm the Order of the Board.
/s/ _________
RENÉE COHN JUBELIRER, Judge ORDER
NOW, March 29, 2012, the Order of the Workers' Compensation Appeal Board in the above-captioned matter is hereby AFFIRMED.
/s/ _________
RENÉE COHN JUBELIRER, Judge BEFORE: HONORABLE BERNARD L. McGINLEY, Judge HONORABLE RENÉE COHN JUBELIRER, Judge HONORABLE ROCHELLE S. FRIEDMAN, Senior Judge CONCURRING AND DISSENTING OPINION BY SENIOR JUDGE FRIEDMAN
I respectfully concur in part and dissent in part. I agree with the majority's conclusion that the City of Pittsburgh (Employer) had a reasonable basis for filing its suspension petition because, at that time, it neither knew nor should have known that Joseph Buckley (Claimant) was actively seeking employment. However, I disagree with the majority's conclusion, based on the existing record, that Employer reasonably continued to contest liability after the February 2009 hearings. Therefore, I would affirm in part, vacate in part, and remand for further proceedings.
Although Claimant did not appear at the first hearing on February 3, 2009, his counsel submitted an affidavit in which Claimant stated that he did not remove himself from the workforce and that he was actively seeking employment. Claimant's counsel also admitted Claimant's resume and a list of positions for which he had applied since September 2008.
At the second hearing on February 19, 2009, Claimant appeared and testified that he did not consider himself retired, (WCJ's Findings of Fact, No. 2), and that he continued to seek employment despite his injury-related limitations, both before and after the filing of Employer's petition, (WCJ's Findings of Fact, No. 2(c)). He also testified that he applied for a disability pension not because he wished to retire, but because he wished to retain his medical benefits. (WCJ's Findings of Fact, No. 2(d).)
As the majority points out, Employer asked to withdraw its suspension petition at the final hearing on June 16, 2009, four-and-one-half months after the first hearing at which Claimant's counsel submitted Claimant's affidavit and four months after the second hearing at which Claimant testified. Unlike the majority, I am unable to find substantial evidence in the record to support the conclusion of the Workers' Compensation Appeal Board (Board) that Employer "promptly" withdrew its petition "as soon as" it learned that Claimant was actively seeking employment and did not voluntarily retire. (Board's Op. at 6.)
Moreover, because the WCJ determined that Employer's contest was unreasonable at the time it was filed, she did not reach the question of whether Employer's contest became unreasonable after either of the February 2009 hearings. Without any findings by the WCJ on this crucial issue, I believe that the Board erred in reviewing this claim. See Sears Logistic Services v. Workers' Compensation Appeal Board (Preston), 937 A.2d 1151, 1156 (Pa. Cmwlth. 2007) (vacating the Board's order and remanding to the WCJ where the WCJ failed to make findings necessary for proper application of the law); Port Authority of Allegheny County v. Workmen's Compensation Appeal Board (Hamilton), 505 A.2d 1372, 1374-75 (Pa. Cmwlth. 1986) (vacating the Board's order and remanding to the referee where the referee failed to make factual findings on all essential issues); see also Habib v. Workers' Compensation Appeal Board (John Roth Paving Pavemasters), 29 A.3d 409, 412 (Pa. Cmwlth. 2011) (noting that the WCJ is the ultimate factfinder in workers' compensation cases), appeal denied, ___ Pa. ___, ___ A.3d ___, 2012 Pa. LEXIS 492 (Mar. 6, 2012).
Accordingly, I would affirm the Board's order to the extent that it concluded that Employer's contest was reasonable at the time it was filed. I would vacate the remainder of the Board's order and remand to the Board for a remand to the WCJ for findings of fact and conclusions of law on the issue of whether Employer's contest became unreasonable after either of the February 2009 hearings.
/s/_________
ROCHELLE S. FRIEDMAN, Senior Judge